Winnipeg 1912 — new book by Blanchard tells of year when optimism reigned supreme

The following is an abridged excerpt from the recently-released book Winnipeg 1912 by Jim Blanchard (University of Manitoba Press, Winnipeg, MB, R3T 2M5;; softcover paperback, $24.95).

The book by the former president of the Manitoba Historical Society, now head of reference services at the U of M’s Elizabeth Dafoe Library, deals with the year when Winnipeg reached its peak as the “Chicago of the North.” In 1912, Winnipeg was known as the fastest growing, most aggressive and cosmopolitan city in Canada. Unfortunately, the wave the city had rode to prosperity ended with the close of 1912.

Blanchard captures the spirit and optimism of the year — social, economic and cultural. He sets the stage for 1912 by also providing an explanation of the earlier events contributing to the fast-paced growth. But, the good times were fated to end and, when they did, the city settled down to a more staid existence. 

Blanchard gives the looming clouds of war and the end of foreign investment as the conditions contributing the end of the great boom. He gives only some credence to other arguments that the fall began with the opening of the Panama Canal (finished 1913 and opened 1915), which allowed the city to be bypassed as a distribution hub. He only says that this event didn’t have ramifications until the 1920s. Yet, by 1912, Eastern businesses and investors had already begun to revamp their enterprises to reflect the coming new reality. 

Each chapter of the book is named after the 12 months of the year. The excerpt is from the chapter entitled August: Holidays, Real Estate. In August 1912, the “real estate boom had been driving prices upward for almost five years,” which is reminiscent of today’s thriving real estate marketplace, although the present boom is far less dramatic. (The excerpt has been abridged to fit the space allotted.)

“... Fortunes had been made, at least on paper, by speculation in land, and both local investors and those from other parts of Canada and from Great Britain were still eager to buy ... Some prudent individuals began to warn that the end of the wild ride was in sight, although during 1912 they were largely ignored ...

Winnipeg was certainly in the grip of the fever; the editor of Dominion Magazine, the Winnipeg monthly that made boosting the city its main theme, assured his readers in May 1912 that Winnipeg real estate was like stocks and bonds: a solid investment. It was “without risk” — music to the ears of the thousands of people who were gambling their savings and borrowing heavily to buy Winnipeg properties. 

While the editor did admit that some land sharks had been selling remote outside lots in suburbs that did not really exist, small investors had been warned; there was nothing to worry about.

The same month, on May 25, the finance columnist of Town Topics observed that the profits that promoters had made selling lots in various western towns were now being invested in Winnipeg. He echoed the supreme confidence of the Dominion editor when he wrote: “Real Estate is now an investment in Winnipeg and not a speculation. That cannot be said of most of the western cities, not excepting Vancouver.”

Agents trying to sell lots in Winnipeg usually pointed to the tremendous growth in the value of land. In February, Town Topics reported that the Chevrier family’s old Blue Store property on Main Street north of McDermot sold for $5,000 a front foot — probably the highest price ever paid for Main Street property. The owner of another downtown lot had just completed a multi-year lease agreement that would net him $7,000 a year more than the original purchase price. 

The land on which the new Albert Hotel would be built, on Albert Street, had brought a price of $64,000. Two lots on the corner of River and Osborne sold for $55,000, earning a profit of about $30,000 for the owners, who had held the lots for only two years. Lots purchased in 1905 doubled, trebled, or quadrupled in value by 1910; why should not similarly placed lots increase in value by the same ratio by 1915? 

In January, Town Topics made the basic argument that all speculators must have been repeating like a mantra in those heady months. “Winnipeg was a growing city, and will continue to grow, and with this growth property values in all sections are bound to keep pace. It needs only the announcement of some railway operations or industrial development to send prices away up in any section, and then we witness a new standard of values set. For this reason, in a city like Winnipeg, no property can ever be described as permanently stagnant, as development proceeds too rapidly.”

In early February, for example, H.A.D. Chalmers Real Estate was selling residential lots in Transcona, far beyond Winnipeg’s city limits, where the Grand Trunk’s new shops were under construction. The price was $200, and, said the Chalmers ad in the Free Press on February 3, “This is a splendid chance to get in on a money making proposition. Get in while you can get in at these low prices. The chance won’t last long ...”

The Canadian Annual Review for 1912 included a long analysis of western real estate speculation. It quoted Sir William Wiseman, a British MP, who believed that “a great deal more money is bound to be made in real estate because the [Canadian] cities are all growing.” The same analysis noted that British investors such as Lord Northcliffe, A.J. Balfour, and Sir Thomas Lipton — three Winnipeg streets, Lipton, Ruby, and Lenore, still bear his name and those of his two daughters — all owned properties in Winnipeg.

The tour of the Canadian Agency investors on September 1 featured many of the most attractive real estate developments in 1912 Winnipeg. This syndicate had invested heavily in Tuxedo Park, the suburb southwest of the city being developed by Frederick Heubach and his firm, and also owned about 360 hectares south of Tuxedo. This latter area was to be an industrial suburb that would include working men’s housing and a variety of factories. The brand-new, $3,000,000 Canada Cement Plant was already in operation, the first, they hoped, of many industrial enterprises. Their holdings elsewhere in the West included a huge tract of 100,000 hectares near Edmonton ...

Speculating in real estate was a long-established feature of the British/Ontario culture shared by so many of Winnipeg’s business élite. In his book about Hamilton in the 1860s, Michael Katz writes: “Given the limited investment opportunities of the time, land occupied the place that the stock market some day would assume. As one historian has written recently, the buying and selling of land for possible profit, whether on a very small or a very large scale, was almost a universal pre-occupation, almost, it might be said, the Upper Canadian national game.”

According to Katz, speculating was not seen as a disreputable activity; quite the contrary, “it meant the man was enterprising, promising and worthy.” These are words that many people in Winnipeg would have used to describe John Machray in 1912. The nephew of the late Robert Machray, Anglican Archbishop of Rupertsland, and a respected local lawyer who was in charge of the considerable investments of both the Anglican Church and the university, Machray and his partners in various deals were riding the crest of the real estate boom. 

A great deal is known about his business because of its eventual and spectacular failure. When Machray finally went bankrupt in 1932, revealing that he had lost close to $2,000,000 of University of Manitoba and Anglican Church funds in bad investments, a Royal Commission inquired into his activities ...

In the so-called Strathcona Point Syndicate, Machray had the Galts as partners, along with federal cabinet minister Robert Rogers, and local people such as C.W. Rowley and Lee McCarthy. They bought a tract of land adjacent to the new site of the Manitoba Agricultural College, south of the city. It was purchased in 1911 from R.A.C. Manning, a local Tory organizer, and Colin Campbell, a provincial cabinet minister, before it was generally known that the college would be moving to the site ... 

He became an associate of the three Diamond brothers, Jewish businessmen, with whom he bought land just north of the Salter Bridge. Harold Trenholme, the manager of the Bank of Commerce on north Main Street, who became, in 1912, the son-in-law of Archbishop Matheson, was also a partner in this syndicate and may have been the person who connected the Diamonds with Machray ...

Machray also, like many others, promoted a subdivision in 1912. He had purchased a large tract of land west of Winnipeg in St. James near the Deer Lodge Hotel and had it surveyed into lots to form the Deer Lodge Subdivision. During 1912 he offered, through his agents, the Stewart and Walker Real Estate Company, building lots on Sharp Boulevard, and along Duffield, Moorgate, and Conway streets ... Newspaper ads for this subdivision claimed it was sixteen minutes by streetcar from City Hall, which might have been true if the car did not pick up any passengers along the way ...

It was promised that Sharpe Boulevard would soon be Winnipeg’s most “artistic” and popular thoroughfare; only houses costing more than $3,500 would be allowed in the area and no unsightly buildings or undesirable businesses would be tolerated.

Frederick Heubach was another well-connected real estate developer in the city. Early in March the papers carried an announcement that Heubach, Finkelstein and Heubach had just floated a $1.5 million loan in London ($25 million in today’s dollars). David Finkelstein said there was no precedent in Canada for a private loan of that size. They planned to use the money to start on the Tuxedo suburb, putting in streets and sewers.

The Town Topics real estate reporter was full of confidence about the suburb. On March 2, he wrote: “Mr. Heubach, Fred Heubach, that’s the name that fits him best — stepped over to London and there the force of his proposals struck home. These world investors realized the situation and its possibilities. The money is now put up. In a year or two the result will be a suburb more permanent as the ideal home centre of Winnipeg than any district yet touched by the combined skill of the beautiful home builder and the landscape architect.”

Frederick Heubach ... in 1905 formed the Tuxedo Park Company, selling shares to raise the capital to buy a large tract of farmland southwest of the city. Tuxedo was to be an exclusive and expensive suburb and Heubach engaged the firm of Frederic Olmsted, the designers of Central Park, to lay out the plan. The area was enhanced by the opening of City Park in 1909...

Augustus Nanton ... had married a wealthy Scottish woman and proceeded to make a fortune acting as an agent for Scottish investors. Nanton’s assignment was to discover new areas for large investments by their Scottish clients. 

Over the years Nanton’s canny and conservative management of the investments of many clients, such as the North of Scotland Canadian Mortgage Company, made money for them and for himself. He never granted a mortgage where the risk was too great and, in the first fourteen years of his career, he never had to foreclose on a borrower ...  By 1912 he was one of Winnipeg’s millionaires, and a board member of several companies, including the Hudson’s Bay Company and the CPR ...

R.T. Riley had likewise come to the west in the 1880s to look after the investments of someone else: Senator W.E. Sanford of Hamilton. Unlike Nanton, Riley was in Winnipeg at the time of the boom in the early 1880s. He describes selling off town lots belonging to his clients in the fantastic auction sales run by Big Jim Collican: “I was very skeptical of these town sites ever amounting to anything and I was careful to advertise them as the property of the Honourable C.P. Brown, Colonel Kennedy and W.E. Sanford and others. I never signed my name to anything except as agent. I paid Collican between $4,000 and $5,000 a night in Commissions on sales ...”

Riley ... was conservative with his own money, as he says in his memoirs — “I bought tax sale and cheap lands, half breed claims, etc.” — and always resold

 as soon as he had made a small profit.


“Half breed claims” were the land grants given as compensation by the federal government to the children of the Red River Métis under one of the provisions of the Manitoba Act. The Métis were given “scrip,” or documents that entitled them to 240 acres for each eligible person. The equivalent of over two million hectares in prairie lands was issued as scrip in a complex process that worked itself out between 1870 and 1925. 

The disposal of Métis scrip and how many Métis actually benefitted from it has been and continues today to be a matter of great controversy. Many people in Winnipeg in 1912 had profited from buying and selling scrip. 

Arthur Wellington Ross, for example, is described by Thomas Flanagan as “one of the biggest buyers of Metis lands in Manitoba.” Ross employed “claim runners” to buy up scrip as it was issued to the Métis so that he could resell at a profit ...

Augustus Nanton, a man of comparatively high principles, revealed that he, at least, saw the ethical problems in speculating in scrip. He told his partners: “I do not want to buy scrip from dealers and scalpers who rob the half breeds, but I will buy direct from the owners at a good price.”

W.F. Alloway and his partner H.T. Champion had also invested in scrip and in much other land besides in the early days ... between 1906 and 1912, they liquidated all their holdings, doubling the capital of their banking firm. 

Around 1900 Alloway had purchased a large number of lots, along the south side of Portage Avenue between Main and Smith streets, for $90,000. This property was all later resold for a total of around $500,000. 

One of Alloway’s most famous deals involved taking, in payment for a carriage and two fine horses, the strip of land between Portage Avenue and the River and Walnut and Maryland streets. He later sold the land for $30,000 ...

John Haffner, the general agent for Hanover Place, a suburb to be built northwest of the exhibition grounds in the neighbourhood around the present Sisler High School, was typical of many people trying to sell subdivision land in Winnipeg at this time. The new underpass on McPhillips, carrying traffic under the busy CPR main line, was a selling point for this subdivision. 

Haffner invited prospective investors to send for a folder and a copy of Chataway’s Map of Winnipeg. This annual city map was a fascinating mixture of reality and fantasy — all the subdivisions actual and future were laid out, with streets and avenues fanning out across the prairie. That many of the streets on Chataway’s map didn’t exist, or were just tracks across the prairie or through the scrub oak with surveyor’s stakes marking the way, was not important because it was not intended to help travellers find their way but to guide investors who traded in lots, hoping to get rich ... he also invited eager small investors to buy a lot by simply clipping the coupon in his newspaper ad. We will never know how many trustingly sent their cheques accompanied by the coupon, which said: “I enclose $15.00 for which kindly reserve the best 175 foot lot in Hanover Place. I agree to pay the remaining instalments of the purchase price in 9 monthly payments of $15.00 each.”

The most colourful real estate agent in town was Fred Hilson, an auctioneer who called himself “The Man with the Hammer” in his flamboyant newspaper ads:

“Say friend, go to Hilson’s to buy

“You can’t do better, don’t try ...”

Town Topics ran a piece in April, satirizing the seedier side of the business. Entitled Real Estate Investments: Able Unbiased Honest Information for the Asking, it featured imaginary letters from potential real estate buyers and answers from the “expert” at the paper. The gist of the expert’s answers is that if the paper is getting ad revenue from the real estate company, then it’s a good place to put your money. If the firm refuses to advertise with them, they pan the project. 

Some of the fictional developments are funny, though: advertising Winnipeg-style projects in remote parts of Manitoba’s north, such as boulevard lots in Norway House and the Brummagem addition in South Port Churchill ...

We can get a glimpse into the workings of a busy real estate office of this time in the files of M.R. Grant, who, with his partner, operated out of 401 in the McArthur Building. People living in Britain and other parts of Canada used Grant’s services. 

Grant had written to a Mr. Broderick, in Midland, Ontario, advising him that there were many people moving to Riverview and there was a heavy demand for lots. In March, Mr. Broderick wrote back that he did not want to sell his lots in Riverview, a new middle-class neighbourhood in the south end of Winnipeg: “I think I ought to be able to get a better price after spring has opened up and building operations are under way ...”

A. Lawrie of Forest, Manitoba, wrote asking Grant to sell his lots in Elmwood because “I hear there is a boom on there now and the present may be an opportune time for disposing of them.” 

Joseph Finkelstein, who lived in Winnipeg on Henry Street, also asked Grant to sell some property for him: lots on the corner of Ellice and Edmonton. Dozens of similar letters came in that spring, all asking for lots to be sold so the owners could cash in on the boom ...

During 1912 the feeling grew that the boom might be nearing its end, although many were reluctant to believe it. Warnings about an inevitable crash were given by reputable people, such as the presidents of both the Bank of Commerce and the Bank of Toronto, who warned against speculation in subdivision lots in January 1912. 

In Town Topics on January 20, the real estate columnist agreed with this advice and noted that reputable firms in Winnipeg did not deal in worthless subdivision lots. For example, he reported that the firm of Mark Fortune and Company had lately made several sales of property on Wellington Crescent and in River Heights, and plans were underway to construct several expensive residences. The message was clear: there were speculators in Winnipeg but there were also respectable firms dealing in properties that were of solid value.

In response to another bank president’s speech, warning of the coming crash, the Town Topics real estate writer agreed that everyone knew this. “This elevation of prices and taking off layers of profit cannot continue ad lib. But while the layers can be taken off what sane man is going to desist from doing so. There is always the chance that the next layer of profit will never come, but there is no westerner that will not take a chance on that. Then there are so many now that can so well afford to take a chance. Mr. Wilkie can also make up his mind that the westerners who have accounts in his bank are going to use their credit to its limit in order to deal in real estate ...”

Everyone seemed to have conveniently forgotten the terrible aftermath of the boom of 1881 and 1882 in which so many speculators had been ruined and the young city’s economy all but ground to a halt. In the later 1880s and 1890s, a local business paper, the Commercial, had often editorialized about the contrast between respectable businessmen, who worked steadily to create wealth, and the speculators, who were vultures, parasites, and sharks who fed upon the industry of others, producing nothing, adding nothing to the wealth of the country, but taking profits that others had earned. 

In 1912 speculation was respectable once again.

In a speech reported in the June 22 Town Topics, R.T. Riley worried that some of the subdivisions being sold out on the horizon were relatively worthless and yet wage earners were pouring money into them. He gave the example of one subdivision that had been placed on the market some time ago by a prominent real estate firm. He had predicted then that the development was five years ahead of its time, but fifteen years would have been closer to the mark. At present, there were only three houses in an area with room for 80,000 people ...

In June 1912, Town Topics had predicted this fate for the small speculator, whereas larger investors were protected by the banks. “The pinch falls heavy on the little fellow, but the banks have to go easy on the big fellow with a big line. If he gets away the loss will tell. He is humoured and his affairs are nursed until ill times pass by. But the little fellow will be turned over to the assistant manager to be summarily closed out whenever his account shows signs of danger.”

Even many of the “big fellows” eventually succumbed to the effects of the collapse of 1913. For John Machray and Fred Heubach, the slowdown in the economy and the resultant decline in the demand for new housing meant that they, like many other people, were left with large holdings that could not be sold ...

Frederick Heubach was likewise left holding a large amount of land in Tuxedo that would not see house construction until the 1920s. He passed away in 1913 and his son gave up his interests in the garden suburb they had dreamed of building and moved to England. Development of the Town of Tuxedo was left to their partner, David Finkelstein, who became mayor of Tuxedo until the 1950s and did see the suburb become a reality.